Bancor V2 – Liquidity reloaded
One of the primary concerns surrounding trading new cryptos is limited liquidity. Most digital assets are traded against the two most popular cryptocurrencies, Bitcoin, and Ethereum which further aggravates the liquidity problem. New Crypto and DeFi entrants can get discouraged because there is a limited choice available to them along with the woes of higher transaction costs and fees that some centralized exchanges have.
In comes Bancor, a solid blockchain protocol that attempts to bridge this difference. Bancor lets users convert their diverse virtual currency tokens almost instantly without the need to exchange them on any cryptocurrency exchange. Virtual coins can be traded which goes a long way in combating the liquidity battle. Its new network is built on a new class of cryptocurrencies called smart tokens and smart contracts.
Bancor V2 – Features
July 2020, the release of Bancor Version 2 is imminent and we intend to elucidate all that you must know what the V2 has up its sleeve.
- Bancor V2 attacks the liquidity problem in the heart by providing 100% disclosure to a single token.
- The bonding curve that represents the relationship between price and token supply has worked out to become more performance-oriented. This has reduced slippage meaning the difference between the expected price of a trade and the actual trade execution price has reduced considerably.
- An integration of Chainlink price oracles with Automated market maker (AMM) has ensured the reduction of impermanent loss which is the difference between holding tokens in an AMM and what you hold in your wallet.
- There is also increased support for other lending protocols.
Problems that Bancor V2 will solve
Slippages can happen anytime, but it occurs the most when market orders are used in volatile markets. It also can happen when a large order is executed but the volume falls short at the selected price to maintain the present bid/ask spread.AMM’s have been at the receiving end for needing huge amounts of liquidity to achieve volumes with order-book based exchanges.
- Flexible bonding curve that aims to magnify the capital efficacy of AMM’s.
- The new bonding curve will reduce slippage by using up pooled resources within the price conversion intervals.
- Liquidity providers will now be able to conjointly fund AMM’s which will guarantee more volumes with limited capital requirement.
Impermanent Loss mitigation
AMM technology sure has taken off but users who provide liquidity to AMM’s have experienced devaluation of their staked tokens relative to token holding. This risk known as the impermanent loss has deterred many commercial institutional users from provisioning liquidity.
- Bancor V2 helps create AMM’S with pinned liquidity reserves which will enable holding the relative value of reserves stable. It will use prices from ChainLink’s price oracles. Curve’s stablecoin pool is a fitting example of a successful AMM building with pegged reserves but they are limited to stablecoins and synthetic coins.
- But this new version does not restrict itself to stablecoins or wrapped tokens expanding its solution to even volatile assets. Liquidity providers just need to hold the token to which liquidity is being provided.
- Token teams and end-users benefit from good profits from trading fees.
Single token exposure
We now know that AMM’s needed liquidity providers to maintain exposure to tokens in their reserves. Users contribute their resources to a network by parking their tokens in a smart contract for autonomous swaps. The more the capital in AMM, the easier it is for other users to swap the token. But, the community-sourced liquidity faces a hurdle that is taking exposure to a separate reserve asset while providing liquidity.
- 100% exposure to single ERC20 token. Liquidity providers do not need any reserve token.
- Option to select exposure to any token in AMM open from 0-100%.
- Liquidity providers can maintain their long position while they earn rewards and trading fees.
Liquidity providers faced a constant issue of low profitability because of their decreased ability to earn lending interest. The interoperability of open source De Fi protocols also was questionable.
- AMM’s integrated lending protocols will allow liquidity providers to generate lending interest on top of trading fees.
- Liquidity can be added or removed with ERC20 tokens. AMM’s will utilize wrappers for lending and reverse-lending the tokens.
- Liquidity providers can now realize higher profitability.
With the new version, Bancor will rope in more liquidity to the protocol. Being experts in the liquidity pool, Bancor V2 intends to create disruption by decreasing the opportunity costs and driving further profits.
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Visor Finance (VISR): The YFI for NFT’s?
Visor Finance: A smart user-controlled platform to interact with DeFi protocols
Within the realms of liquidity mining in the decentralized Finance sector, there are several issues that need to be supervised. Right from discoverability and reputation to programmability to the security of liquidity, the issues are hard to deal with.
Visor Finance is a truly ground-breaking protocol that overcomes this issue and works towards building the liquidity mining protocol. Its solution aims to mint and interacts with NFT Smart vaults where users will have the ability to interact with the existing DeFi protocols but with their VIsor NFT’s. The team put up a great FAQ for beginners here.
This implies that in a Liquidity rewarding program, rather than depositing tokens in the project’s smart contract, the users lock them to their NFT and will still be eligible for rewards.
Key aspects of Visor NFT
NFT’s or non-fungible tokens are everywhere. It was once just an obscure part of the blockchain technology world but its boom has led to a sudden embrace in its entirety. NFTs are usually associated with digital art or in-game assets but Visor Finance has implemented an NFT for a use case that is not related to art or game but it has been designed to interact with multiple DeFi protocols.
Let’s take a look at some key aspects:
- Visor NFT will act as the key interface between the user’s funds in custody and DeFi protocols to which they interact with. Every single Visor is easily identifiable by its singular string of digits which also is a complaint ERC721 id.
- During its liquidity mining program, the user funds are immediately unlocked without any counterparty risk during the mining program if needed.
- Assets can also be assigned to diverse liquidity mining programs. This can be done without the need for the assets to leave user custody and attaching it to the required endpoints.
- The best part is that the user funds are quickly discoverable by liquidity mining programs. The platform users can then authorize staking and unstaking to their Visor NFT for reward distribution.
Benefits of the platform
VisorNFT allows users to lock assets into several concurrent liquidity mining reward programs. The users will have the ability to sign ahead in time permissions for top DeFi platforms at the protocol level. The owner of the vault can submit a signature for assets in the vault to become collateralized. The user-controlled contract vault also has something called the Visor’s factory which will allow for the introduction of updates and extensions to the Visor NFT without breaking compatibility across reward platforms. There are several contract templates which the users can choose for minting new versions of the Visor NFT.
Visor also aims to keep the NFT with its unique ID and immutability with several paths for upgrades and extensions. The purpose of the upgrades will be for easy migration of assets through the web user interface.
How do the upgrades take place?
The Visor smart vault factory boasts an ownable admin. The admin will be able to introduce new templates for upgrades and extensions to the Visor smart vault. They will also set the default behavior for active templates. Visor Finance strives to pass on these rights to the community and with more developments, it intends to make it their top priority.
The Visor Factory will also have a default active template which will also double up as the stable release of the Visor Smart vault. Users will have the go-to choose alternative templates to mint for different reasons. The canonical release will be considered the default and will be put under upgradation consideration only after it has been discussed with top industry leaders.
Liquidity Bootstrapping pool
The Visor community participated in the liquidity Bootstrapping pool with full zest and enthusiasm. The event in association with Balancer Labs was a huge success and marked the successful launch for Visor Fiance. More than 900 addresses participated in the Pool event. 450 people also went through the NFT minting process through the web UI and now own their Visor NFT smart vault.
It also has brought about two governance proposals which were suggested by the Visor community members. Based on their suggestions and inputs, the team has adjusted the rewards program as given below:
Proposal 1: Additional communities for Phase 1 consideration
Proposal 2: Very active participants in DeFi, why not adding INV and RULER
The whitelist rewards will be extended to many other active DeFi communities which have active snapshots and run liquidity mining programs. It will also extend to those communities which run yield farms that will align with the use-case of Visor. The proposals at the end will allow for greater participation in phase one of the rewards program but will also accelerate the overall use of the Visor NFT.
Hence, in essence, Visor NFT is a user-controlled systematic, hassle-free vault that holds assets, and provides safe exposure to DeFi protocols without giving up on custody. The Visor NFT is not about those properties that are manifested in the art of in-game assets.
They go a step ahead to utilize and assist in accelerating NFT’s capacity for being singular, unique for different purposes. For the user, this is a golden opportunity to expose their vault’s history of past interactions with DeFi protocols with Merkle roots of hoards of permissioned addresses, enhanced liquidity visibility more so at a network level.
The users are at liberty to choose their own strategy but they will never have to relinquish their assets. The community per se values being given the autonomy to choose and since the Visor NFT platform is all about user-control it will help in the wider and higher participation in future developments. The platform is now looking to integrate with projects to implement their rewards program in order to be compatible with the UniversalVault standard that the Visor NFT uses.
Rewards go live Monday, more details can be found here.
Visor Finance CoinGecko: https://www.coingecko.com/en/coins/visor
Visor Finance Vault: https://vault.visor.finance
Visor Finance Twitter: https://twitter.com/VisorFinance
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Delta Token : DEX Gamechanger Launching Soon. Will it be a Uniswap Killer?
Delta Token : Here’s what you need to know
Delta Token is the tokenized version of partially locked liquidity that will run on the soon to be launched, next-generation decentralized exchange called CoreDEX.
The new Delta token launched by Delta Financial (from the cvault.finance team) will play a significant role in changing the norms of DeFi and DEX’s in general.
The cvault. finance team makes their new entry to space with CoreDEX, continually pushing the boundaries, and it’s as revolutionary as ever.
Uniswap was fantastic when it first came out and still is in many ways, yet it is fairly one-dimensional.
This next-generation decentralized exchange is like Uniswap on steroids. It’s a magnificent thing to behold-offering not just token swaps a la Uniswap, but also:
- Collateralized loans
- Options Trading
- Leveraged Positions
- Locked Liquidity futures
The connection between the underlying assets and options markets often takes longer because the options trading market is often marred by a highly illiquid nature vis-a-vis the spot markets. The poor liquidity position in the options markets has led to an undue and uncalled-for increase in premiums in options prices. The ratio of low liquidity and the high premium is inversely proportional which also makes them highly volatile.
Delta Financial is entirely aware of the apparent loophole and has solutions and liquidity standards enabling it to deploy an on-chain options layer so that it can scale up to meet the market forces.
Delta Financial has two types of liquidity:
- Open vesting liquidity that takes place through the Delta vesting schedule
- Permanent Locked liquidity
Open Vesting Liquidity
Apart from utilizing that locked liquidity, the CoreDEX will also offer a new type of liquidity provision called Open Vesting liquidity. With this new provision temporarily locked liquidity will be offered to those who are looking to participate in CoreDEX without the need to buy CORE LP.
One of their team members 0xdec4f said this:
The team studied the trends in DeFi a lot and saw that while locked liquidity creates certainty, it does not attract as much capital inflow as “free” liquidity does. You can see this in protocols such as Uniswap or Sushi.
We saw billions in TVL being moved from Uniswap to sushi over a very short time and that shows also the disadvantage of this type of liquidity. If it’s free to move, it will move wherever it can get the most value.
That’s when the team realized that currently, we have two extremes when it comes to liquidity.
Free Liquidity (sushi/uniswap) <———> locked liquidity (CORE)
Both have advantages and disadvantages. Instead of picking up free liquidity and adding that to the platform we decided to develop a new form of partially locked liquidity and tokenized it, and that’s what Delta is.
The funds raised in the initial staking window will be used by the team to fund Delta’s long-term development. Out of the total, 26% will go to build strategic partnerships and 10% will be kept aside for research and development.
CORE can be locked in the CoreDEX migration contract and earn fees from CoreDEX alpha and beta. This will be until the testing phase after which the platform will stabilize further and the user can be done as planned. The team is basically building two sections for coreDEX namely:
- CORE will focus on sustainable yield generation. This will take place through token trading and lending products.
- DELTA will address the dearth of options and futures in the market and will go a long way in curbing and eliminating impermanent loss.
The new product combinations combine to create a system for options liquidity providers. This way it will remove impermanent loss because the system has been built from the ground level to ensure liquidity provision.
Delta Token Vesting Schedule
Delta has an innate vesting mechanism built on its token which is pushed when a transfer is triggered. The vesting period is based on a block number schedule and is activated when Delta is transferred.
Out of the maximum, users get 10% of the token balance while 90% is initially locked. Over a 2-week period, it will be released in a linear fashion. When a token transfer happens it rules out the vesting schedule. This way the immature tokens get distributed to the vault in the form of staking rewards.
It has come up with novel ways to create new instruments and tokenized products such as yield-producing volatility, great concept of futures based on locked liquidity, leveraged positions, collateralized lending, and much more.
The users can trade all of these offerings easily in a highly liquid market. CoreDEX will run on a new liquidity provider token. LPs from CoreVault can easily trigger migration to the new core LP token. This way the platform will rebase its liquidity pool depending on the market conditions. The platform also ensures that the holders are provided with revenue sharing.
The Core community is standing strong with three liquidity pools wherein CORE has around 60 million + in locked liquidity.
Liquidity Rebasing Token (rLP)
The Delta team scores again with their outside of the box thinking with their liquidity rebasing token. They describe it here:
A new generation of tokens is in development which has an LP rebasing mechanism. It aims to limit the amount of LP tokens generated, making them more exclusive. Following an algorithmic rebasing raise, the LP mint price increases while the liquidity pool size stays the same. As a result, the price of minting new LP tokens becomes increasingly expensive to the point where they are unobtainable, creating a truly scarce LP token.https://medium.com/core-vault/coredex-black-paper-ff51542fb8ac
Deep Farming Vault
The deep farming vault is yet another ingenious facet introduced by the Delta Financial team. The medium article states: “The Deep Farming Vault collects and distributes Delta, based on the unique Delta Vesting Schedule mechanism. Users deposit Delta or rLP tokens to earn a yield, the smart contract uses those assets to secure the unique liquidity deployments of the protocol.“
In the deep farming vault users can earn both Delta tokens and ETH.
Limited Staking Window
This is how you contribute to get delta tokens before it officially launches.
As of 2/25/21, nearly 5000 ETH has been raised and there are 6 days left in the limited staking window.
Those contributing are hoping to replicate the out-of-this-world ROIs they achieved during the cvault.finance launch. The ambition of this project is incredible, and if it succeeds would be a total game-changer in decentralized finance.
You can learn more about the details of the limited staking window here.
If you are contributing, make sure to use this to receive 10% bonus in ETH on your contribution.
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BAO FINANCE CRYPTO: WHAT IS IT?
BAO FINANCE CRYPO TAKING OFF! WHAT IS IT?
Bao Finance crypto token has exploded recently with unprecedented growth due to its numerous unique features. Bao Finance focuses clearly on providing a fair and equitable distribution and the creation of synthetic assets. It is an innovative second layer for synthetic assets that have been built on top of Uniswap, SushiSwap, and Balancer.
Bao Finance will use an upgraded version of the SushiSwap farming infrastructure and intends on capitalizing on the yield farming distribution model. However, at present, the APY is very attractive to farmers.
The BAO Finance crypto token acts as the governance token for the community-run project. It also is backed by an insurance fund where all the BAO fees get accumulated.
BAO creates a second-layer protocol and the users will utilize the assets from Uniswap, SushiSwap & Balancer to take part in the BAO ecosystem. BAO finance can also be seen as the first L2 DeFi that aims to add its protocol’s features to existing infrastructure. Users will be able to generate synthetic assets by using their LP tokens from other protocols. This has many benefits as users will be able to:
Earn fees and yield rewards by being a Liquidity provider in Uniswap, SushiSwap, and Balancer.
They will also be able to earn rewards in $BAO by staking their LP tokens as collateral. They also can issue furthermore, synthetic assets to invest in other assets. Essentially speaking BAO finance focuses on early distributive equity and the generation of synthetic assets.
Yesterday, February 4, Hotbit launched BAO Finance on its global section. The deposit function was launched yesterday at 9.00 AM UTC and the trading function was launched at the same time yesterday. The launch comes with the unraveling of 2 trading pairs – BAOFI/USDT, BAOFI/ETH for the same. Hotbit cryptocurrency exchange is also a cryptocurrency trading platform that integrates different forms of solutions like spot trading, financial derivatives, and DAPP also integrated into one platform.
The most interesting thing about yield farming here is that there are several hundreds of LP pairs available to yield farms. Though users will only get 5% of the BAO token which they farm the remaining period will be the vesting period of over 3 years with a 1-year cliff!